If your business operations rely on the use of vehicles, your vehicles become an important component of your business. You must ensure that your vehicle or fleet of vehicles has sufficient commercial auto insurance coverage to cover a wide range of damage and loss. When you buy the coverage, your insurance provider may consider certain factors to calculate your insurance cost. While some factors, like accidents and low credit scores, are known to increase your rates, some other factors may come as a surprise to you.
In this blog, we will mention the six unexpected factors that may affect your commercial auto insurance cost and discuss how they may do so.
During the slump in the economy, like all businesses, you also must have implemented cost-cutting measures that included reduced vehicle usage. With the economy on the mend, things are again looking up for businesses. However, to cope with increased activity, instead of buying new vehicles and employing new drivers, you may choose to rely on your existing infrastructure. This may lead to each vehicle covering much higher mileage than before and increasing your insurance rates.
With many experienced drivers nearing retirement age, most businesses are looking for trained drivers with adequate experience. However, the introduction of new driving regulations that the drivers need to be familiar with, such as electronic time logs and tracking sheets, may prove to be a deterrent in your search for experienced drivers. Hiring drivers with relatively less experience may cost you more in premium rates.
The one often overlooked factor that also impacts the number of motor accidents is the fuel price. When fuel rates are higher, fewer people can afford to drive their vehicles both for personal and business purposes, meaning fewer vehicles on the roads. Likewise, when the rates are affordable, more drivers venture onto the roads, thus increasing the probability of accidents happening. You may expect an increase in your insurance cost when the fuel rates stabilize over a period of time.
Mobile phones are big distractions for drivers. Other similar distractions include Bluetooth and internet search functions, GPS, and the radio. Even a moment of distraction may cause an accident and subsequently raise your insurance costs. Automated vehicle systems may also result in making the driver lax and negligent resulting in accidents.
With more and more attorneys jumping into the fray and striking a hard bargain for their clients and helping them win higher payouts as settlements than before, insurance companies often increase the premium rates to be able to settle the claims.
Medical costs for accident-related treatments are getting more expensive, which in turn has affected the auto insurance sector. The increase in medical expenses is reflected in the increased insurance costs.
If you are looking for commercial auto insurance coverage, you can contact us. With over 100 years of experience, we at Knight Insurance Services can ensure that your business vehicles have maximum coverage at the best available rates.
